Tuesday, January 30, 2018

Position sizing

Just a reminder to respect position sizing and the importance of not being in a hurry to size up once profits start rolling in.

When the chart pattern, price action, and catalyst line up to my predetermined specifications, I will not hesitate to be a big fat pig.  But it took me hundreds of trades to get to this point.  

It’s easy to get impatient and overly confident -- believe me.  Especially after making a few winning trades and seeing some of the impressive profits charts on this site.

$PTIE, $INSY, and $PTI are recent stocks in which I've had $1k+ losses.  I can pull them from memory so easily because of the psychological strain I had from holding and managing such big losing positions.  I had no business sizing up as I did in these less than perfect set ups.

My (unsolicited) advice?  Don’t be in a hurry to size up once you start making money.  That’s how you blow up an account and become a statistic.  Instead trade small and comfortably until you’ve proven yourself to yourself with performance consistency and by account growth.